Spring Buying Arrives at Auto Auctions
Courtesy of Black Book.
Vehicle depreciation rates were at the lowest levels seen all year last week, as the effects of the spring market demand begin to kick in, according to Black Book’s Feb. 26 Market Insights report.
Overall, average wholesale car segment values declined by 0.18% last week, compared to 0.23% the week before. Overall, truck segment values declined by 0.21%, nearly half of the 0.43% depreciation that the segment saw the week prior.
The car segment’s low depreciation last week was mainly driven by the performance of the subcompact, compact, and mid-size car segments, which saw values rise 0.31%, 0.02%, and 0.01% last week. The performance of these segments can in part be attributed to the low cost associated with them. The wholesale values of cars have sunken so low in recent years that they offer buyers with an attractive low-cost option that presents a lot of value, according to Anil Goyal, executive vice president, operations for Black Book.
The three luxury segments that Black Book tracks were the car segment’s weakest performers. This isn’t a new trend, luxury car values struggled throughout most of 2017. One factor impacting this trend is rise in features being offered in non-luxury vehicles. In years past, certain features were only found in luxury vehicles. More recently, many features found in luxury vehicles can also be found in higher trim levels of non-luxury vehicles, at a lower price, Goyal added.
Small and full-size pickups, along with compact and full-size vans saw the lowest depreciation within the truck segment last week, with values falling 0%, 0.03%, 0.06%, and 0.06%, respectively. Subcompact luxury crossovers/SUVs were on the other end, realizing the highest depreciation last week at 0.85%.